FirstCry IPO Open : The IPO (New IPO) of Brainbees Solutions, which runs the omni-channel kidswear business under the FirstCry brand, has been launched today i.e. on 6 August. FirstCry has fixed the price band for its IPO at Rs 440 to Rs 465 per share. While the size of the IPO is Rs 4194 crore. Retail investors will be able to subscribe to the IPO till 8 August. The size of FirstCry’s IPO is Rs 4194 crore. In this, fresh equity shares worth Rs 1666 crore will be issued. While 5.4 crore shares worth Rs 2,527.73 crore will be sold through OFS Offer for Sale (OFS). According to the IPO, the value of the company has been estimated at Rs 22,475 crore.
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Swastika Investmart : Neutral
Brokerage house Swastika Investmart has given a neutral rating to FirstCry’s IPO and has advised to take a decision only after doing proper research before investing.
1. The brokerage says Brainbees Solutions is India’s largest online retailer of baby and child care products and boasts strong brand identity, customer royalty and engagement.
2. BrainBees has faced financial challenges, posting losses despite revenue growth. Negative cash flow further underscores these concerns.
3. The company operates in a highly competitive environment. A meaningful P/E valuation cannot be determined due to the absence of profitability.
4. There is a lack of peers to be compared, which limits comparative analysis.
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SBI Securities: Subscribe for long term
Brokerage house SBI Securities has advised to subscribe to FirstCry IPO for the long term.
5. The brokerage says that BrainBees Solutions is valued at 3.4 times FY24 EV/Sales multiple and 5 times P/B on post-issue capital.
6. On the revenue front, the company has registered a growth of 15 percent CAGR in the last 2 years and has become Ebitda positive in FY 2024.
7. It is well positioned to tap the $120 billion market size of child, mother and kids care products. Its store count has grown by 50% to 1063 in the last 2 years, and the break-even of these stores is expected to contribute to profitability.
AUM Capital : Subscribe
Brokerage house AUM Capital has given a subscribe rating to FirstCry, considering it a leading brand in India.
8. Brokerages say that with the increase in disposable income, parents these days are spending more on child care.
9. With its unique brand position and market share, FirstCry always finds itself as the top choice among its potential customers.
10. India’s child care penetration is very low compared to global standards, which is a huge opportunity for branded players like FirstCry. Moreover, investments in its manufacturing facilities are expected to strengthen its presence not only in India but also internationally.
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Who will sell shares in OFS
Mahindra & Mahindra intends to sell 28.06 lakh shares in the IPO through the Offer for Sale. 20,318,050 shares will be sold by SVF Frog managed by SoftBank. Other participants in the Offer for Sale (OFS) include PI Opportunities Fund, TPG Growth, NewQuest Asia, Apricot Investments, Satyadharma Investments, Schroders Capital, Sage Investment and Pratithi Investment.
Ratan Tata, who had acquired 0.02 per cent stake in the startup for Rs 66 lakh, plans to sell all his 77,900 shares in the IPO. The average acquisition cost per share is Rs 84.72, as mentioned in the RHP. This makes his total investment in the company around Rs 66 lakh.
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How much reserve for whom
In FirstCry’s IPO, 10 percent share is reserved for retail investors. At the same time, 75 percent share is reserved for qualified institutional investors i.e. QIB. While 15 percent share is reserved for non-institutional investors i.e. NII. Quota has also been kept for the employees of the company, under which they will get a discount of Rs 44 per share.
what is the lot size
This IPO has a lot size of 32 shares. That is, at the upper price band of Rs 465, retail investors will have to invest at least Rs 14,880. While they will be able to bid for a maximum of 13 lots. That is, the maximum investment can be Rs 193,440.
(Disclaimer: Investing or selling stocks is advised by the brokerage house. These are not the personal views of Financial Express. There are risks in the market, so take expert advice before investing.)
